Veterans Administration halts foreclosures on thousands of veterans about to needlessly lose their homes

On June 21, 2013, a seal was displayed in front of the Department of Veterans Affairs building in Washington.

The Department of Veterans Affairs will stop foreclosures on veterans and active-duty military members with VA loans for six months.

This move follows NPR survey Thousands of veterans who received so-called COVID-19 clemency are now at risk of losing their homes through no fault of their own, an investigation has found.

“Helping veterans and their families stay in their homes is a top priority for the VA,” VA Press Secretary Terrence Hayes said in a statement. “We are calling on mortgage servicers to Foreclosures on Veterans Administration-guaranteed loans are suspended until the 31st.”

Congress created the forbearance program in the wake of the pandemic to allow people who suffered a loss of income to skip mortgage payments for six or 12 months and then affordably start making mortgage payments again.

But in October 2022, VA ended the part of the program that allowed homeowners to affordably retake their current loans, leaving many veterans facing foreclosure. VA has a new plan to replace it but says it will take four to five months to implement.

According to data firm ICE Mortgage Technology, 6,000 VA lenders are currently in foreclosure proceedings due to COVID-19 debt moratoriums, and for many of them it is now too late. There are still 34,000 people who are behind on their loans, according to data firm ICE Mortgage Technology.

After NPR first reported on the issue, a group of senators sent a letter to the VA asking them to stop foreclosures immediately.

“Without a pause, thousands of veterans and service members may needlessly lose their homes,” Democratic Senators Sherrod Brown, Jon Tester, Jack Reed and Tim Kaine wrote in the book wrote in. a letter “This was never Congress’s intent,” said Veterans Affairs Secretary Denis McDonough.

The VA said in a statement that by suspending foreclosures, “we can continue to help veterans get loans while launching the latest home preservation options.” Through the new program, the VA said it The loan will essentially be repurchased from the company that currently holds the loan. Modify them and then keep them in the VA-owned loan portfolio.

“This will allow us to work with veterans facing severe financial hardship to adjust their loans and monthly payments so they can keep their homes,” Hayes said in a statement.

Josh Jacobs, the VA’s undersecretary for benefits, said in a separate statement that he encourages any veterans who are having trouble paying their fees to come visit. Or call 877-827-3702.

“The VA will do whatever it takes to help veterans stay in their homes,” Jacobs said.

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